Original reporting on little-known U.S. government funded foreign aid projects, so-called "drug war" initiatives, and overseas business subsidies.

Corruption and Waste

06/29/2014

While federal lawmakers increasingly try to address the nation’s fiscal worries, “taxpayers might still not see the relief they deserve” by the time Congress alternately slashes and adds to FY 2015 spending bills, one budget analyst has warned.

“Although the House is moving the fiscal needle in the right direction, it is difficult to know where that needle will point once final legislation reaches the president’s desk for a signature,” according to Pete Sepp, National Taxpayers Union executive vice president.

Sepp was asked if there is a disconnect between burdened taxpayers seeking relief and the elected officials who claim to be accomplishing that task.

For example, the U.S. House Committee on Appropriations has pledged to crack down on waste and corruption in foreign aid programs, but it gave the green light this week to send the multi-billion-dollar global gravy train down a track only slightly narrower than last year’s.

As part of the committee’s celebration of its perceived fiscal responsibility, it acknowledged that some of the slashed funds were simply shifted into “higher priority” programs.

06/10/2014

Tab for taxpayers to pay for 'performance-monitoring support'

While the flow of billions of America taxpayer dollars to the Islamic Republic of Pakistan has slowed during President Obama’s second term, his administration nonetheless will put $140 million into a project to figure out how to help “increase stability, democracy, and prosperity for the men and women” of that nation.

Private contractors will reap the windfall of an aid-effectiveness assessment known as the Performance Management Support, or PERFORM, initiative, which simultaneously seeks to determine whether Obama has accomplished anything thus far in Pakistan.

The U.S. Agency for International Development, or USAID, is tasked with conducting the PERFORM endeavor, for which contractors will provide “performance-monitoring support” of existing assistance programs.

The step comports with existing USAID policy stemming from requirements in the Enhanced Partnership with Pakistan Act of 2009 that the agency determine if government clients are effectively and efficiently carrying out their contractual obligations.

USAID/Pakistan currently maintains in-house staff to monitor the program effectiveness, particularly in high-threat and security restricted areas such as Karachi, Federally Administered Tribal Areas and Khyber Pakhtunkhwa.

According to the project Statement of Work, for the agency employees to satisfy their contractor-oversight responsibilities, additional contractors are needed to obtain “performance monitoring data.” The aim of the five-year, $140 million PERFORM initiative, therefore, is to obtain that data.

USAID then will use the information to identify existing program problems and to devise project improvements and adaptations. It also will leverage the data “to inform new project designs.”

The agency separately is evaluating the effectiveness of “highly specialized management information system and geospatial information system,” or MIS/GIS, services that a contractor is providing to USAID/Pakistan.

The MIS/GIS initiative will help the agency to track more closely 90 active contracts – valued at more than $1.9 billion – that USAID/Pakistan currently manages.

The administration’s FY 2015 budget request for Pakistan aid is $881.8 million – significantly less than the nearly $2.4 billion sought and congressionally appropriated in FY 2011.

Peace and Security operations comprise $399.2 million of the FY 2015 total, with the remainder slated for Economic Development ($276 million); Health ($80 million); Democracy, Human Rights and Government ($76.6 million); and Education and Social Services ($50 million).

Included in the category of Peace and Security operations is State Department training through its Anti-Terrorism Assistance Program, or ATA. As U.S. Trade & Aid Monitor's Steve Peacock recently discovered, the State Department purchased hundreds of pounds of plastic explosives and thousands of containers of liquid explosives, which it claimed it would use in the training of ATA partner nations such as Pakistan.

Similarly, an Obama plan to change Pakistan’s culturally embedded mistreatment of women and girls might fall under several budget categories.

Other recently launched USAID/Pakistan endeavors include the Khyber Pakhtunkhwa Governance Project, a four-year $24 million program that seeks to improve the ability of that provincial government to provide public services to its citizens.

The Commercial Agriculture Project, which likewise is a four-year $24 million program, will help “improve the ability of Pakistan’s agriculture and livestock sectors to meet both international and domestic demand.”

The official justification for U.S. assistance to Pakistan focuses on the pursuit of “robust continued security and civilian assistance that contributes to a more secure, stable, tolerant, democratic, and prosperous Pakistan.”

The broader aim is to “make the region safer and also contribute to U.S. security.”

This article originally was published June 8 via WND.com. Under agreement with WND, rights have reverted back to its author, Steve Peacock.

06/06/2014

New guide for corporations, foreigners to game U.S. taxpayers

The Obama administration has taken its corporate-welfare road show to Mexico, where American taxpayers funded a three-day conference over the last week, with an aim to simultaneously subsidize U.S. industry while helping Mexico tap into the U.S. Treasury to fund its national infrastructure plan to the tune of hundreds of billions of dollars.

Among the highlights of ConnectMEX – the U.S.-Mexico Transport and Telecom Conference – was the U.S. Trade & Development Agency’s unveiling at this Mexico City venue of a “Resource Guide for U.S. Industry on Priority Infrastructure Projects.”

USTDA – an independent White House agency – in its ConnectMEX promotional materials simply tout the guide as a roadmap containing “detailed descriptions of project opportunities” for the U.S. transportation and telecommunications sectors.

However, the resource guide not only cost U.S. taxpayers $100,000 to create, but serves as a vehicle for both U.S. businesses and the Mexican government to obtain contracts and grants paid for by the American people.

Among potential options for this modernization effort involving hundreds of billions of dollars is financing through governmental institutions such as the U.S. Export-Import Bank, or Ex-Im, and the Overseas Private Investment Corporation, or OPIC.

USTDA in last year’s bid request for the resource guide explicitly directed the contractor to contact Ex-Im Bank, OPIC, and private/commercial institutions to obtain such information on behalf of Mexico, the host nation “Project Sponsor.” The document also specified that the contractor must evaluate this financing data to ensure “which options represent the best value” for Mexico.

“USTDA is sponsoring ConnectMEX to help establish stronger transportation and telecommunications connections between Mexico and the United States,” Director Leocadia I. Zak said during the event’s opening remarks. “We are proud to connect industry-leading U.S. experts to Mexico’s plans to enhance its infrastructure in order to improve the daily lives of its people.”

The amount of that grant – which USTDA is giving to the Asociación Mexicana de Ferrocarriles, Mexico’s national railroad trade association, is unclear, as USTDA announced the grant without revealing its value.

One conference attendee claimed it was a $150 million, though that amount is highly unlikely in the context of past agency grants. An email and separate tweet sent to USTDA was acknowledged, but clarification on the amount was not given by deadline.

The railway grant will support the Mexican industry group’s efforts “to modernize its fleet of specialized freight railcars.

“The project will recommend specific investments in new systems, services, terminals and railcars to meet the projected growth of freight transportation in the country.”

USTDA said it also plans to release “a complete Resource Guide to highlight additional projects in Mexico’s energy, water and environment sectors.”

While USTDA arguably is a relatively small agency – its FY 2014 budget request is just under $63 million – it consistently undergoes criticism along with calls for closure. Former Rep. Ron Paul and free-market think tanks such as the Cato Institute regularly denounce it as among the most duplicative and wasteful of all federal entities.

USTDA, Ex-Im Bank and OPIC consequently are among the most egregious examples of “corporate welfare waste,” the Cato Institute concluded in a 2005 report. These and similar organizations “should be terminated,” contends the report’s author, Chris Edwards.

Totals for previous Ex-Im Bank and OPIC financing of Mexican infrastructure projects were not readily available for this report, but a search of prior USTDA initiatives reveal numerous efforts to arrange U.S. backing of such projects.

USTDA under Obama has financed a multitude of other transportation initiatives that simultaneously benefit the Mexican people and U.S. businesses, courtesy U.S. taxpayers.

Multiple DMs and feasibility studies for airport modernization and expansion initiatives, as well as for numerous environmental endeavors, have received USTDA funding since Obama first took office.

Some of these endeavors precede Obama and took place under the George W. Bush administration.

The agency under Bush was equally generous to the Mexican government, which likewise received grants to explore financing options for infrastructure as well as “green” projects.

Bush’s USTDA in 2006 paid for a DM whose aim was to help Mexico achieve closer parity with the “strength and competitiveness” of the U.S. and Canada¸ its North America Free Trade Agreement, or NAFTA, partners.

Despite the overall viability of this trading block, USTDA at the time lamented that Mexico “suffered from lost manufacturing jobs to Asia and is searching for methods to regain its competitiveness,” according to the DM for the Mexico Secretariat of Communications & Transportation Multimodal National Plan.

“One of Mexico’s solutions to increasing competitiveness is to capitalize on its geographical proximity to the U.S., offering more secure and efficient trade transportation networks with the U.S. and thus Canada,” the agency said in that endeavor.

USTDA similarly financed an analysis of Mexico’s planned modernization of Tijuana as a modern transportation center just south of the California border.

Recently USTDA separately awarded a $50,000 grant to KED Group to assess Mexico’s needs in an “intelligent transportation” project in the State of Jalisco.

The agency last October awarded a $50,000 contract to the Seneca Group to conduct a DM on behalf of the Mexican Association of Railroads. That endeavor’s purpose was to help USTDA decide whether to help fund additional projects supporting “the development of Mexico’s freight rail system, which is a critical component of Mexico’s economy and trade.”

Potential projects were to include assessments of railroad infrastructure “to accommodate the transportation of various oil and gas products.”

It remains unclear whether that project is a predecessor activity to the USTDA grant announced this past week at ConnectMEX. Often the agency will conduct a DM before carrying out a more expensive and detailed feasibility study of the same project.

USTDA separately agreed to provide a $455,000 grant to the State of Puebla Secretariat of Transportation to conduct a feasibility study of a proposed “intelligent transportation system” project.

Puebla authorities reached out to the administration for help because the “demand for public transportation is expected to increase at an even higher rate than its population growth.”

U.S. officials agreed that the development of bus rapid-transit systems along six of the Puebla’s key corridors would “provide significant benefits to Puebla’s population in terms of improved convenience and safety, shorter travel times, and reduced environmental impacts.”

The Monitor's Peacock had reported on those projects as part of a broader review of Mexico-specific, U.S. funded initiatives. However, in contrast to the USTDA intelligent transportation system and railway endeavors – which must hire U.S. contractors — the U.S. Agency for International Development is prohibiting U.S. contractors from participating in a recent assistance scheme.

The ConnectMEX conference was carried out for USTDA by the Business Council for International Understanding, or BCIU, a New York non-profit whose stated objective is to “facilitate dialogue and action between business and government to promote international understanding.”

BCIU is led by Chairman Ahmet C. Bozer, a Turkish businessman and president of Coca-Cola International, as well as BCIU President Peter Tichansky, who also serves on a United Nations advisory board “to build a permanent UN memorial to the trans-Atlantic slave tragedy.”

A similar version of this article originally was published via WND.com on June 1. Under agreement with WND, rights have reverted back to its author, Steve Peacock.

11/29/2013

Supporters of Barack Obama tout his dedication to the responsibilities of the presidency by noting that he had taken 96 days of vacation at the point in his term that President George W. Bush had taken a reported 335.

But they admit that 51 of Bush’s trips were to his Texas ranch, while records show that Obama’s destinations have ranged from exotic European and African locales to pricey digs to Hawaii, where he’s sometimes traveled separately from his family, effectively doubling transportation costs for taxpayers.

The records released are partial, meaning no firm travel-expense total can be assembled. But individual cases are revealing.

08/13/2013

Prez brings home bacon in midst of Chicago corruption probe

A no-bid contract to assess a $48 million Kenyan youth program has
been awarded to the University of Chicago, where President Barack Obama
taught constitutional law for 12 years.

This discovery coincides with the federal embezzlement indictment of
Quinshaunta R. Golden, former key aide to Eric E. Whitaker, the one-time
U. of C. Medical Center executive vice president and former colleague
of Michelle Obama.

07/31/2013

Bureaucracy proposed to overcome Kenyan obstacles

President Obama’s multi-billion-dollar “Power Africa”
initiative aims to double citizen access to electricity and other power sources
across Sub-Saharan Africa. But it plays down the creation of a new
public-private bureaucracy needed to overcome the pervasive corruption and
incompetence of African governments and power utilities.

A significant portion of the Kenya-based endeavor is
designed simply to administer the program. Segments include efforts to sway
public and congressional opinion in favor of the initiative, according to a new
planning document U.S. Trade & Aid Monitor located through routine database research.

The U.S. Agency for International Development, or USAID,
will hire a contractor or contractors primarily to persuade African officials
to change regulatory governance of power distribution, explains the draft
Statement of Work, or SOW. A corresponding agency goal is to encourage, with
contractor assistance, the escalation of private-sector investment in the
region.

The USAID chief of party, or COP, and deputy COP, “who will
be the overall managers of the contracts,” will reserve 10 percent of program
funding for those government managerial functions, the document says.

The project’s overarching goal “is to remove the power
constraint to economic growth and spur trade and investment, while mitigating
long-term greenhouse gas (GHG) emissions trajectories,” the draft SOW says.
“Power Africa will serve as a catalyst that will spark a transformation in
Africa’s energy and power sectors.

“The immediate outcome will be increased supply of and
access to reliable, affordable, and sustainable power for millions of Africans
and the enhanced responsible and transparent management of energy resources.”

Put in simpler terms, despite Obama’s ambitious and
confident proclamations about the endeavor during his recent Africa trip, the
document simultaneously affirms his vision and acknowledges the great
difficulties the U.S. faces in executing such reforms.

Among other factors, the weak regulatory, policy and legal
environments – made worse by continent-wide “corrupt and non-transparent
bidding and contractual procedures” – serve as constraints to the sort of
international investment Obama wants to bring about, the SOW says.

Political instability, a lengthy history of state-owned
utilities and the “fear of change and competition” likewise deter private
sector project-development and investment.

Consequently, the Obama administration expects U.S.
taxpayers over the next five years to commit $7 billion toward stabilizing and
correcting the investment roadblocks.

Whereas USAID will provide $285 million in technical
assistance to remedy what it admits are typically corrupt and often incompetent
governmental bodies and utility providers, the administration will direct the
remainder of the funds through other U.S. agencies.

Among the entities are the Export-Import Bank of the United
States, the Overseas Private Investment Corporation and the U.S. Trade &
Development Agency – entities that the Cato Institute says should be
“terminated” because they largely serve as monumental vehicles of “corporate
welfare waste.”

Reminiscent of a prior scheme to sway journalists into
providing favorable coverage of its Kenyan aid program – a document for which the
agency abruptly blocked public access following this writer's coverage of the matter – the USAID prime
contractor also must provide communications and outreach support that will be
“directed at the American public, U.S. Congress” and elsewhere, the draft SOW
says.

The agency kept the program quiet for a year before
repackaging it with decreased emphasis, according to publicly available
documents, on the propaganda angle, as the Monitor recently reported.

According to the Power Africa draft SOW, the selected vendor
must devote 20 percent of its efforts under the prime contract towards
“institutional support” for the program coordinator’s office.

Communications and outreach activities represent just one
component of institutional support, which also entails tracking and coordinating
activities among “Power Africa implementers and stakeholders” such as other
U.S. agencies, host country governments and non-governmental organizations, the
document says.

Although USAID’s East Africa Regional Mission in Nairobi,
Kenya, is home to the coordinator’s office, Power Africa also has plans for
Ethiopia, Ghana, Liberia, Mozambique, Nigeria, Tanzania and Uganda.

This article originally was published via WND.com (July 23, 2012). Under agreement with the editor, rights have reverted back to the author, Steve Peacock.

07/30/2013

Obama tries out high-tech play device in Tanzania while energy executives and the Tanzanian president look on.

The tail end of President Obama's Africa Trip -- which stopped in Tanzania, the third and final stop on this tour -- contributed $650,000 toward the reportedly $60-$100 million journey. And that was just for the hotel rooms, U.S. Trade & Aid Monitor has discovered.

According to a Justification and Approval for Other Than Full & Open Competition, or JOFOC, document that the Monitor located via routine database research, the U.S. Department of State requested "an estimated number of 179 single rooms intermittently from June 14 thru July 10, 2013.

The president and First Lady Michelle Obama stayed in Tanzania July 1-2. State justified booking all of those rooms for several weeks, however, based on its assessment that:

Hotels are predicting 100% occupancy due to bookings from the USG [U.S. government] and other high level VIP delegations from other countries. In order to fulfill our requirement, the USG is renting nearly the entire hotel and is utilizing a variety of room types, which were negotiated at a one-price-fits-all rate which benefits the USG.

Requirements for rooms from the USG and other countries, coupled with the limited supply of suitable, available hotels in Dar Es Salaam, created a peak demand for rooms. Prices for rooms at the Hyatt for this visit are within the rates charged for similar rooms during this season and are similar to the prices received from other hotels. As such, the rates are the established market rates for this class of hotel.

State awarded the no-bid contract to Hyatt Dar Es Salaam because "Security concerns prohibit sufficient advanced notification of VIP travel to allow for sufficient time to conduct full and open competition," the document says.

State released the JOFOC document on July 26. It awarded the contract, however, June 19.

07/29/2013

The Chinese business sector must be in trouble. Why else would
President Obama be sending taxpayer dollars there to modernize China’s
energy grid, hire private-sector consultants to help its Ministry of
Environmental Protection and separately help to modify the nation’s
corporate laws?

The U.S. Trade & Development Agency, or USTDA – technically
designated as an “independent” White House agency – is funding these and
other initiatives, all of which aid China while simultaneously
benefiting U.S. contractors.

President Obama’s multi-billion-dollar “Power Africa” initiative aims
to double citizen access to electricity and other power sources across
Sub-Saharan Africa. But it plays down the creation of a new
public-private bureaucracy needed to overcome the pervasive corruption
and incompetence of African governments and power utilities.

A significant portion of the Kenya-based endeavor is designed simply to administer the program. Segments include efforts to sway public and congressional opinion in favor of the initiative, according to a new planning document WND
located through routine database research.